Morning View: Chancellor Jeremy Hunt Budget will be unpopular, but necessary

The Chancellor of the Exchequer, Jeremy Hunt, put the nation on notice yesterday that he will raise taxes in the Autumn Statement, which is due to be announced this Thursday.

This is not welcome news, but it is probably inevitable due to the extraordinary spending commitments that the government took on during the Covid pandemic.

We learned as well that the scheme to support people with their energy payments, the timing of which is still uncertain in Northern Ireland, will cost the same as the NHS.

Mr Hunt is anticipating the media reaction by casting himself as ‘Scrooge’ in this grim pre-Christmas budget. He has the unenviable task of telling people they need to pay more taxes and that spending on services will be cut.

Logically, only the naïve could have expected the government to continue splurging money as it has done in recent years, without having, at some point, to pay it back.

If he did not address the deficit, the chances are that the chancellor would be faced by the threat of even higher inflation, which would make us all poorer and more miserable.

The economic approach adopted by Rishi Sunak is very different, and arguably more realistic than that of his predecessor, Liz Truss. Ms Truss believed that the UK could defy global trends and ignore inflation, by cutting taxes and continuing to spend in an attempt to grow the economy.

While her vision was more hopeful, the markets felt it was less persuasive than what we’re hearing now.

It was an attractive idea that countries could spend money at the rate they were doing during the pandemic and suffer no pain as a result, but it was not pragmatic. Mr Hunt’s budget will not be popular, but it’s probably necessary.